Greece rushing to finalize reforms and remain in euro

 

Details of Greece’s reforms are to be submitted Thursday, giving time for creditors to review them ahead of a summit of the European Union’s 28 members set for Sunday.

Greece’s government was racing Thursday to finalize a plan of reforms for its third bailout, hoping this time the proposal will meet with approval from its European partners and stave off a potentially catastrophic exit from Europe’s joint currency, the euro, within days. Details of Greece’s reforms are to be submitted Thursday, giving time for creditors to review them ahead of a summit of the European Union’s 28 members set for Sunday.

Hopes for a deal rose after Donald Tusk, who chairs the EU summits, said that Greece’s plan would have to be matched by creditors’ suggestions on how to make the country’s debt manageable in the longer term. “The realistic proposal from Greece will have to be matched by an equally realistic proposal on debt sustainability from the creditors.

Only then will we have a win-win situation,” Tusk said. Easing the terms of Greece’s existing bailout loans has been a key dividing issue in the bailout talks for months — with Greece and the International Monetary Fund pressing in favour and key European states like Germany resisting the idea.

Tusk’s comments boosted confidence that the sides will be able to find a compromise. The Stoxx 50 index of top European shares jumped 2.6 percent. Prime Minister Alexis Tsipras was meeting Thursday with finance ministry officials to finalize his country’s plan, a day after his government requested a new three-year aid program from Europe’s bailout fund and promised to immediately enact reforms, including taxes and pensions, in return.

The last-minute negotiations come amid bank closures to staunch a bank run in Greece, where capital controls have been imposed that restrict Greeks to cash withdrawals of 60 euros ($67) per day.

The closures have been extended through Monday. Pensioners without bank cards have been particularly hard hit as they have struggled to access their accounts. Some branches have been opened so the elderly and unemployed without bank cards can withdraw a maximum weekly sum of 120 euros each.

Hundreds lined up outside banks Thursday morning, many facing hours-long waits in the heat. Separately, many ATMs had a shortage of 20 euro notes, effectively reducing the daily withdrawal limit to 50 euros.